HSBC senior executives said to face questions from Senate panel

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LONDON — HSBC, the largest financial institution in Europe, has become the latest British bank to reveal major internal-control problems, saying that senior officials would apologize to US lawmakers next week for not cracking down soon enough on money-laundering activities in America.

The money laundering, which a Senate subcommittee indicates was linked to terrorism and drug deals, could result in HSBC paying fines of up to $1 billion, according to analysts.

‘'Our anti-money-laundering controls should have been stronger and more effective, and we failed to spot and deal with unacceptable behavior,’’ Stuart T. Gulliver, the chief executive of HSBC, wrote in a memo released to employees late Wednesday.

HSBC said Thursday that it would have no further comment before a hearing Tuesday in Washington.

HSBC is under new management since the period when the money laundering occurred, from 2004 to 2010.

HSBC can distance itself from the money-laundering episode by chalking it up to the previous management. But the bank, along with more than a dozen financial institutions, also faces scrutiny by regulators on both sides of the Atlantic for any role the companies might have played in an the interest-rate manipulation scandal that has embroiled Barclays, a main HSBC competitor.

One big HSBC investor, who was not authorized to speak publicly, said that while it was a serious lapse not to have caught customer money laundering sooner, it did not necessarily indicate a deeper ethical problem within the bank.

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That investor plans to closely follow developments to see what role — if any — the bank played in trying to manipulate key interest rates, including the London interbank offered rate, or Libor. If any issues arise, it could lead to more political pressure and damaging lawsuits, especially in London.

”We do not think there is a culture of money laundering at HSBC,’’ the investor said. ‘‘Management overlooked it but will fix it. But Libor is different.’’

Adding another political wrinkle: HSBC’s former chairman, Stephen Green, who was in office from 2006 to 2010 when many of the money-laundering detection problems occurred, is currently the trade minister in Prime Minister David Cameron’s government. Green’s office did not reply to a request for comment on Thursday.